WTI: Upside stalls near $ 56.50 ahead of API data
|- Buoyed by rising Gulf geopolitical tensions that threaten supply disruption.
- Unabated US dollar strength, dwindling oil demand keep the upside in check.
- All eyes on trade, geopolitics and US API crude stockpiles data for fresh direction.
The latest uptick in WTI (futures on Nymex) faltered just ahead of the midpoint of the 56 handle, as a tug-of-war between the bulls and bears continue ahead of the American Petroleum Institute (API) weekly crude stock data release.
The sentiment around the black gold remains underpinned by rife Middle East tensions, in the face of last week’s seizure of the two British tankers by Iran in the Strait of Hormuz. Markets fear the escalating tensions in the Gulf would hamper the crude supplies, as the Hormuz Strait is one of the key trading channel.
Despite the renewed strength in the barrel of WTI, the sellers continue to lurk amid persistent broad-based US dollar demand and bleak global oil demand outlook (as reported by the International Energy Agency recently). Falling odds of aggressive July Fed rate cut combined with a deal reached by the US President Trump and Congress leaders on the US debt offer extra zest to the USD bulls. A stronger greenback makes the USD-sensitive oil expensive for the holders in foreign currencies.
The immediate focus now remains on the USD dynamics and geopolitical developments, as markets eagerly await the API crude report, due at 2030 GMT, for fresh direction on the prices.
Levels to watch
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